For SAS, Java Development to Remain Key

Since James Goodnight founded business intelligence software developer SAS Institute Inc. 26 years ago, the Cary, N.C., company has grown to be what it claims is the largest privately held software company in the world, with more than $1 billion in annual revenue. Goodnight, who is SAS chairman, president and CEO, has seen a lot of technologies come and go during his tenure. eWeek Executive Editor Stan Gibson and Senior Writer Dennis Callaghan caught up with him at the SAS Users Group International conference in Orlando, Fla., earlier this month to discuss Java, Microsoft Corp., and the future of the company and its technologies.

eWeek: Java is important to SAS. What do you make of Microsofts .Net?

Goodnight: My view is that .Net is a proprietary system that people should steer clear of. Youve got a company that is so powerful that they can come out with their own proprietary system and get everybody to use it so that it is not portable to any of the Unix [operating systems].

Were going to stick with developing [JavaServer Pages]. Were a Java shop and plan to stay that way. Fortunately, Java still will run on Windows, at least for now, although you never know what might happen in the future.

eWeek: What if the worst happens?

Goodnight: I expect somebody will get sued [laughter].

We had a perfect chance to try to have an industry standard around Java. Then you have this little company that says, "Well, we dont want to let other players in. We want to have our own proprietary standard." And its just a shame.

eWeek: Microsoft has embraced [Simple Object Access Protocol] and [the Universal Description, Discovery and Integration specification] in .Net. Do you still consider them neutral standards?

Goodnight: Weve got a lot of adherence to some of the Microsoft standards, but I just think the .Net stuff is going a little too far.

eWeek: Does Microsoft send people down to evangelize you?

Goodnight: Oh, yes.

eWeek: Do they ever apply pressure?

Goodnight: Not that I know of.

eWeek: How do you view Linux?

Goodnight: We support Linux. Red Hat [Inc.] has come out with an enterprise edition that is stronger, more enterprise industrial strength.

eWeek: So Linux is strong enough to warrant your continued investment?

Goodnight: Yes. We already run under Unix on [Solaris, Digital-UX and HP-UX], and even IBM is moving toward Linux and running it on mainframes.

eWeek: As the founder of SAS, what are your plans for your and the companys future? Do you plan to hand over the reins to a successor, and will SAS go public?

Goodnight: Im always looking for the type of talented people who can take a bigger load at SAS. Going public is still an option. The issue is that we dont have our financial systems in place yet.

We decided not to keep using our own software for financial reporting and move to Oracle [Corp.] software because our financial people said they wanted it for reports. It was a year and a half ago and about $10 million ago that they did that.

This particular version [of Oracle Applications], 11i, was reported to have over 10,000 bugs in it. They send a patch that fixes 10 things and breaks two. They dont believe in testing things.

eWeek: Customers we talk to seem to like your products and the support, but they say theyre expensive.

Goodnight: I think our customers have always complained about the price. But yet they all renew every year.

I think theyre getting a lot of value for their money. One thing we have failed to do as a company is to get SAS spread through customer organizations to the point where everybody realizes the value of the software. For example, SAS may be down in the basement running the IT shop. And then management decides they need some reading on how the rest of the business is running, so they buy [business intelligence software from] Cognos [Inc.] or Brio [Software Inc.] or something like that.

eWeek: A year ago, SAS Version 9 was slated to be available last quarter. Now its supposed to start shipping in the middle of the year in staged releases. Why did it fall behind?

Goodnight: Until [our quality assurance staff] says its ready to ship, then its not going to ship. Right now, the bug rate is way too high to release.

eWeek: How much effect is the slow economy having on your business?

Goodnight: After the first quarter of last year, we started seeing a slowdown, to growth of only 3 percent. Then after Sept. 11, business growth pretty much stopped.

eWeek: How can you best serve your customers in the slow economy?

Goodnight: This whole idea of adding intelligence to the operational or [enterprise] layers that have been built over the last decade is something that can provide a very good [return on investment] for our customers. For example, we can help them analyze their historical customer data to tell them which of their customers are the most likely to leave the next month unless they do something about it.

We can help them find out which ones they ought to give a loan to, mail a credit card application to or a catalog to. All these things can show a terrific return on investment.